This section is from the book "Dart's Treatise On The Law And Practice Relating To Vendors And Purchasers Of Real Estate", by J. Henry Dart . Also available from Amazon: A treatise on the law and practice relating to vendors and purchasers of real estate.
Prior to the Sale of Land by Auction Act, 1867, it was settled at Law that, unless the vendor's right to bid was expressly reserved, the employment of a single puffer would of itself vitiate the sale (p).
The rule at Law as to employment of a puffer.
(i) Sug. 14th ed. 13; Kenworthy v. Schofleld, (1824) 2 B. & C. at p. 947; 2 L. J. (0. S.) K. B. 175.
(k) Coles v. Trecothick, (1804) 9 Ves. at p. 250; and see Byas v. Stafford, (1881) 7 L. R. Ir. 590.
(l) See Buckmaster v. Harrop, (1807) 13 Ves. at p. 473.
(m) Williams v. Milling ton, (1788) 1 H. Bl. 81; Emmerson v. Heelis, (1809) 2 Taun. 38; White v. Proctor, (1811) 4 Taun. 209; Kemeys v. Proctor, (1820) 1 Jac. & W. 350; Beer v. London and Paris Hotel Co., (1875) 20 Eq. 412; Sims v. Landray, 1894, 2 Ch. 318.
(n) Peircc v. Corf, (1874) L. R. 9 Q. B. 210, 215; Bell v. Balls, 1897, 1 Ch. 663; Chaney v. Maclow, 1929, 1 Ch. 461, 477.
(o) Mcmeekin v. Steevemon, 1917, 1 I. R. 348, 354.
(p) See remarks of Lord Cranworth, in Mortimer v. Bell, (1865) 1 Ch. 10; 35 L. J. Ch. 25, who treats the rule as well established; Warlow v. Harrison, (1858) 6 Jur. N. S. 66; 1 El. & El. 295; 29 L. J. Q. B. 14; Mainprice v. Westley, (1865) 11 Jur. N. S. 975; 6 B. & S. 420; 34 L. J. Q. B. 229; Green v. Baverstock, (1863) 10
In Equity, however, it was the generally received doctrine that unless the property were expressly or impliedly offered for sale without reserve (q), the employment of a bidder to prevent its going at an undervalue was allowable (r); but the rule did not extend to authorise the employment of more bidders than one, even though they were limited to the same sum (s); nor even of a single bidder, "if the person is employed, not with a view to prevent a sale at an undervalue, but to take advantage of the eagerness of bidders to screw up the price" (t).
Puffers, rule as to, in Equity.
The soundness of the general rule in Equity was, however, questioned by Lord Cranworth in the case of Mortimer v. Bell (u); and by the Sale of Land by Auction Act, 1867, a sale of land by auction which would be invalid at Law by reason of the employment of a puffer is to be deemed invalid in Equity also. It follows that now, even though the sale is not expressly stated to be without reserve, unless the right to bid is expressly reserved, the making of a single bid on behalf of the vendor will vitiate the sale. In every case the particulars or conditions of sale must state whether the land is sold without reserve, or subject to a reserved price, or whether the right to bid is reserved; and if it is stated that the sale is without reserve, or to that effect, it is made unlawful for the seller to employ any person to bid at such sale, or for the auctioneer to take knowingly a bidding from any such person (x). Where it is declared either in the particulars or conditions that the sale is Subject to a right for the seller to bid, it is made lawful for the seller, or any one person on his behalf, to bid at such auction, in such manner as he may; think proper (y). But a condition merely stating that the sale is subject to a reserved price, without expressly reserving to the vendor the right to bid, does not justify the vendor in making a bid (z).
"Sale of Land by Auction Act, 1867."
Jur. N. S. 1047; 14 C. B. N. S. 204; 32 L. J. C. P. 181; Thornett v. Haines, (1846) 15 M. & W. see pp. 371, 372; 15 L. J. Ex. 230; Wheeler v. Collier, (1827) M. & M. .123; Crowder v. Austin, (1826) 3 Bing. 368; 4 L. J. (O. S.) C. P. 118; R. v. Marsh, (1829) 3 Y. & J. 331.
(q) Meadows v. Tanner, (1820) 5 Madd. 34; Robinson v. Wall, (1847) 2 Ph. 372; 16 L. J. Ch. 401; Thornett v. Haines, (1846) 15 M. & W. 367; 15 L. J. Ex. 230.
(r) Woodward v. Miller, (1845) 2 Coll. C. C. 279; 15 L. J. Ch. 6, where the earlier cases are cited; Flint v. Woodin, (1852) 9 Ha. 618; 22 L. J. Ch. 92.
(s) Wheeler v. Collier, sup.; and see 15 M. & W. 372; and Sug. 14th ed. 10.
(t) Per Sir William Grant, M. R., in Smith v. Clarke, (1806) 12 Ves. p. 483.
(u) (1865) 1 Ch. 10; 35 L. J. Ch. 25.